SHANGHAI: Japanese rubber futures fell for a fourth straight session on Wednesday, weighed down by a stronger yen and weaker Tokyo equities, while doubts lingered over whether El Niño will trigger significant production cuts in key growing regions.
The Osaka Exchange (OSE) rubber contract for April delivery was down 6.9 yen, or 1.57 percent, at 431.2 yen (USD2.73) per kg. The market was closed on Tuesday for a holiday.
The rubber contract on the Shanghai Futures Exchange (SHFE) for January delivery fell 370 yuan, or 1.92 percent, to 18,865 yuan (USD2,821.74) per metric ton.
The most-active December butadiene rubber contract on the SHFE lost 155 yuan, or 0.94 percent, to 16,370 yuan per ton. The yen jumped nearly 0.8 percent to 157.92 per US dollar as the dollar tumbled to a one-month low, with safe-haven currencies leading gains after Democrats captured Congress in midterm elections, spurring fears of tougher regulation of the AI sector.
A stronger Japanese currency makes yen-denominated assets less affordable to overseas buyers. Japan’s Nikkei ended 1.42 percent lower, after falling as much as 4.8 percent to its lowest since May 20.
Weaker risk sentiment tends to weigh on rubber futures.
Output in major producing areas faces a test in November and prices could extend their pullback if there is no clear news of production cuts materialising, analysts at broker Everbright Futures said in a note.
However, they said year-on-year declines in output and expectations of stronger domestic demand later this year should provide support to the market.
The front-month rubber contract on Singapore Exchange’s SICOM platform for January delivery last traded at 240.7 US cents per kg, down 1.6 percent as of 0705 GMT.
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